Credit Suisse, 4.5 billion bondholders sue Finma
A group of bondholders from the Swiss credit, representing $4.5 billion of the $17 billion of bonds Additional Tier 1 canceled by the company, have filed a lawsuit against the Swiss banking regulator, according to reports from the Financial Times.
The complaint alleges that the regulator, the Finma, acted unconstitutionally when it ordered Credit Suisse to write off AT1 debt, the FT reported. This move by the Swiss regulator in mid-March infuriated bondholders who thought they were better protected than shareholders in a bailout deal with UBS earlier this month.
The lawsuit was filed on Wednesday by the law firm Quinn Emanuel in the city of St. Gallen in eastern Switzerland. The Credit Suisse group of bondholders holds a “significant” percentage of the total notional value of the bonds, Quinn Emanuel said earlier this month when he was hired by the group of bondholders.